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Is growth always good?

  • Author: Steve Haycox
    | Opinion
  • Updated: August 18, 2018
  • Published August 18, 2018

The buildings of downtown Anchorage reflect the color in the sky just after sunset, back-dropped by the Chugach Mountains and reflected in the calm waters of Knik Arm on Tuesday, April 11, 2017. (Bob Hallinen / ADN)

We have to have growth! As axiomatic in American culture as "life, liberty, and the pursuit of happiness" is the conviction that economic growth is progress and that lack of growth is failure and doom. Economists have many ways of calculating growth, beginning with gross domestic product, the total value of goods and services produced by an economy. Unemployment rates are another.

But for most citizens it's the conclusions, not the methods, that matter. The economy is either growing or it isn't, and if it isn't, it's a bad thing because, most people accept, we get richer and happier with growth, poorer without it. It's the American gospel.

But there's good evidence that growth is not always good. In these pages recently, Charles Wohlforth profiled UAA economics professor Alexander James, who showed in a 2016 professional paper that all the growth associated with oil development after Prudhoe Bay did not in fact make Alaskans richer. Rather, necessary services provided to the new population attracted by oil jobs, which James estimated at 100,000, consumed all the wealth generated by development, leaving us just as we were, or worse than when the development began. Moreover, a case can be made that all that wealth, together with the absence of state taxes, brought along corruption.

In an essay addressing growth, journalist Alana Semuels, writing in Atlantic Magazine in 2016, noted that despite a 3 percent growth rate averaged during the past 60 years, there are still more than 40 million Americans living in poverty. Nobel laureate Michael Spence has urged that Americans shift their notion of growth, be willing to accept slower rates of growth and pay more attention to quality of life — health, security, environment, leisure — rather than focus on getting more money and the material goods it can bring. While that may be a good idea, it's counterintuitive for most Americans.

We want it both ways. In an article in Arctic Today last February, Gloria Dickie reported on a meeting of leaders of cities across the Arctic. They are happy at the prospect of new seaports, roads, railways and airstrips, new mining ventures, oil and gas pipelines, Arctic shipping and the commercial possibilities it will bring. These will create jobs and, they hope, long-term growth.

Chinese investors particularly seem ready to invest in the Arctic future. But the city mayors and managers worry that their cities will lose their remote character, that their societies will be disrupted by inflows of new population, that new influences will change people's expectations, and that the way their towns develop will be determined more by forces outside their regions and outside their control than by the limited options the locals may have. This sounds very much like what happened in Alaska.

But the changes coincident with the development of Alaska's oil were not unprecedented. As long ago as the turn of the 20th century, as the noted Arctic anthropologist John Bockstoce recounts in his several books on Arctic development, including a new one, "Arctic Fox and Icy Seas in the Western Arctic," the arrival of new enterprises reconfigured Native life in Chukotka, northern Alaska and the western Arctic. First, whalers replaced Inupiat traders as suppliers of various goods moving across Bering Strait to far North Siberia.

Then the rise of the fur industry, especially white fox furs, motivated Inuit from Interior Alaska and Canada to move to the Arctic coast to exchange the pelts they trapped with itinerant traders, who braved the dangerously unpredictable ice to bring them guns, motorboats and steel traps, gasoline generators, gramophones and washing machines, canned milk, tobacco, shirts, pants and dresses, as well as a host of other modern goods. When the fur trade collapsed with the Great Depression and World War II, the traders stopped coming and most of the Natives were forced to retreat to the Interior.

Michael Spence and similar economists buck a human drive that is either innate, or else one that's been learned over two hundred years of industrial expansion: We have it in our hearts now that more is better, that growth is our life watchword. But just maybe, slowing to smell the roses would be more rewarding.

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